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GI Bill explained: How much, when, where

Jul. 27, 2008 - 10:45AM   |   Last Updated: Jul. 27, 2008 - 10:45AM  |  
Cpl. Adrian M. Negron studies public speaking at Camp Foster, Japan. Service members or veterans who have already used their full 36 months of GI Bill entitlement, or who will exhaust their benefits before Aug. 1, 2009, will never receive full tuition payments or the new book and housing allowances under the new GI Bill.
Cpl. Adrian M. Negron studies public speaking at Camp Foster, Japan. Service members or veterans who have already used their full 36 months of GI Bill entitlement, or who will exhaust their benefits before Aug. 1, 2009, will never receive full tuition payments or the new book and housing allowances under the new GI Bill. (Lance Cpl. Bryan A. Peterson / Marine Corps)
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Just more than a year from now, on Aug. 1, 2009, veterans' education benefits will undergo a life-changing transformation that will make a four-year college degree suddenly affordable for a new generation of wartime veterans.

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Just more than a year from now, on Aug. 1, 2009, veterans' education benefits will undergo a life-changing transformation that will make a four-year college degree suddenly affordable for a new generation of wartime veterans.

But the year of waiting for the Post-9/11 Veterans Educational Assistance Act to take effect may be filled with disappointment and frustration for some current and former service members.

Due to a combination of misunderstandings about the program's details, demands from the Veterans Affairs Department to delay implementation in order to provide time to work out administrative issues, and the overall complexity of creating a new education plan, benefits provided under the law signed by President Bush June 30 will be less than some people expected.

Still, the bill is a "historic victory," said Sen. Jim Webb, D-Va., the freshman senator who pushed the bill through Congress as part of the 2008 war supplemental funding bill. He said he is confident the Pentagon and VA will work out any kinks.

The leader of a new veterans group also hailed the bill's passage.

"Through the opportunity of an education, veterans everywhere will now be placed on a direct course to the leadership positions throughout our country," said Derek Blumke, president of Student Veterans of America. "Just as they were leaders in combat, they will now be leaders in business, science, art and, most important, in government."

A technical corrections bill already is being written to fix some oversights, such as the inadvertent omission of uniformed members of the Public Health Service from qualifying for the Post-9/11 GI Bill, and the lack of a means to determine future benefits for people attending colleges or universities outside the U.S.

Four groups of people may be disappointed as details become clearer:

• Spouses and children of current service members expecting to use GI Bill benefits — after the Pentagon demanded that such transfer rights be added to the final bill — are now learning that the option of sharing education benefits will not be available until Aug. 1, 2009, at the earliest, and even then this aspect of the program could be limited.

• Service members or veterans who have already used their full 36 months of GI Bill entitlement, or who will exhaust their benefits before Aug. 1, 2009, will never receive full tuition payments or the new book and housing allowances because of the delayed effective date of the new program — and there will be no retroactive payments.

Those who still have remaining benefits today will get a 20 percent increase in their monthly payments on Aug. 1, 2008, which is significant, though not quite as generous as the full tuition plus allowances that will be offered to those who qualify in full for the new plan.

• People enrolled in the current Montgomery GI Bill who have not made the full $1,200 enrollment contribution will continue to forfeit $100 a month in basic pay, even though the new benefits plan will be free. New recruits can opt out of the current GI Bill plan, but defense officials are advising them to think carefully because the new Post-9/11 GI Bill doesn't cover apprenticeships, correspondence courses, on-the-job training, flight training, and some preparatory classes and national exams.

• Veterans attending or who will attend a state college or university and will have their tuition fully or partly covered by a state veterans' program could get paid less under the Post-9/11 plan because their benefits will match only what they pay out of pocket. Under the current Montgomery GI Bill, if their tuition and fees are less than their monthly benefits payment, they can pocket the difference.

Bob Norton of the Military Officers Association of America said none of this should detract from the fact that the Post-9/11 bill includes "pretty significant changes" that will make college more affordable for an entire generation of veterans.

"This is the biggest GI Bill since World War II, and that is a big deal," said Norton, who is also a representative of the Partnership for Veterans Education, a group of about 50 military and higher education associations.

Here are the details of the new plan, according to Pentagon and Veterans Affairs Department officials, including when changes can be expected.

Who is covered?

Anyone who has served three months or longer on active duty since Sept. 11, 2001, is eligible for benefits under the new law, as long as they have not used other veterans' education benefits. That includes those who enrolled in the current Montgomery GI Bill program and those who did not.

Among those who had no benefits but will now qualify for the new program's full-tuition payments and book and housing allowances:

• Officers who were ineligible for Montgomery GI Bill Benefits because they had four-year Reserve Officer Training Corps scholarships or received a service academy education.

• National Guard and reserve members who accumulated at least three months of active service.

• Officers and enlisted members whose service predates the Montgomery GI Bill.

No enrollment is required for the new program, only patience. The delayed effective date of Aug. 1, 2009, applies even to those who have retired or separated from service.

A few eligibility requirements apply. Those who have separated from service must have received an honorable discharge or served under honorable conditions, which includes those released for hardship reasons or pre-existing medical conditions. Anyone whose service is terminated because of fraud or error would not be eligible.

Unlike the Montgomery GI Bill, there is no requirement to have a high school diploma in order to qualify for the new program.

When will benefits increase?

The first effects of the Post-9/11 benefits plan will be felt on Aug. 1 of this year, when benefits under the current Montgomery GI Bill plan for people who serve or have served on active duty will rise by 20 percent.

That will push the current maximum monthly benefit of $1,101 for those with more than three years of active service, and $894 for those with less than three years, to $1,321 and $1,073, respectively.

That increase will not apply to Montgomery GI Bill benefits for the Selected Reserve but it will apply to National Guard and reserve members covered by the Reserve Educational Assistance Program, that awards a percentage of active-duty GI Bill benefits based on the longest period of continuous mobilization since Sept. 11, 2001.

After the Aug. 1 adjustment in Montgomery GI Bill rates, that program's payments will rise each Oct. 1, beginning in 2009, based on the increase in the average nationwide tuition rate for four-year public schools. This is a more generous formula than the current law, which has set annual payment increases to match the rate of inflation — which usually lags behind annual increases in tuition rates.

How much will I get under the new plan?

Full-tuition benefits and the housing and book stipends promised by the Post-9/11 bill will not apply to any education or training before Aug. 1, 2009.

When the new program launches on that date, full-tuition benefits will depend on tuition rates in effect in each state at that time, as well as the length of active service since Sept. 11, 2001. Those with at least 90 days will get 40 percent of their applicable full tuition rate; those with at least six months will get 50 percent; those with at least one year, 60 percent; those with at least 18 months, 70 percent; those with at least two years, 80 percent; and those with at least 30 months, 90 percent.

Those who serve at least 36 months qualify for 100 percent tuition payments. Also, anyone who serves at least 30 days of continuous active duty and is discharged with a service-connected disability qualifies for the 100 percent rate.

The percentages apply not only to the basic benefits payment, but also to the new housing and book allowances.

Once the new program is up and running, annual adjustments in Post-9/11 GI Bill payments will continue to be based on the tuition rate for the most costly school in each state.

How will benefits be paid?

The basic benefit will be paid to the school instead of the individual, a departure from current practice. The payments will be up to the cost for in-state tuition and fees for a full-time student for the most expensive four-year public college or university in the state where the person is enrolled.

VA will pay students a housing stipend equal to the military's basic allowance for housing for an E-5 with dependents in the school's ZIP code, and a book allowance, paid in a lump sum at the start of the semester or term, that can be no more than $1,000 a year.

Post-9/11 benefits can be used for distance learning, but no housing stipend will be paid in those instances.

The full-tuition benefits will be adjusted each year based on changes in tuition and fees. The housing allowance will fluctuate based on the rates paid by the military. The new program has no scheduled adjustment for the book allowance.

What if I go to private school?

Recognizing that full-tuition benefits based on the cost of a four-year public school could fall short of the cost of a private school education, the Post-9/11 GI Bill includes an optional program in which the school and VA would share the cost of paying the difference between benefits and tuition charges.

The "Yellow Ribbon GI Education Enhancement" option would not be available before Aug. 1, 2009. It requires VA and each school to reach an agreement under which VA will match the amount of tuition and fees waived by the college or university. A school could set the maximum contribution it would provide to each student and limit the number of students who could be covered each year. A school's share would have to be a grant or scholarship, not a loan.

A list of schools participating in the program, including details of the agreement, would be made public to allow comparisons.

What about my college fund or supplemental benefits?

Service members who received extra education benefits as an enlistment incentive or who used the "Buy Up" program, in which they set aside more money for larger benefits, would receive those extra amounts in addition to the Post-9/11 GI Bill benefits.

Are full tuition payments retroactive?

Architects of the Post-9/11 GI Bill initially indicated that while the effective date of the program would be Aug. 1, 2009, the biggest increases — full-tuition benefits and allowances for books and housing — would be retroactive to June 30 of this year, the date the program was enacted. It came as a surprise to some people when that turned out not to be the case.

Aides to Webb said the senator is working with other senators to try to get the increased benefits made retroactive to June 30. But defense officials cautioned that troops and veterans should not bank on promises about proposed legislation.

Other Senate aides warned that any further changes in the Post-9/11 GI Bill would have to be "revenue-neutral" — meaning they could not add to the new program's already considerable cost — in order to have a chance of being approved.

What else is covered?

The Post-9/11 GI Bill will pay up to $1,200 in tutorial assistance, up to $2,000 for licensing or certification tests and up to $500 to help cover transportation costs for people in remote areas.

All these benefits take effect in 2009, at the same time full-tuition coverage begins, and are not charged against a person's total entitlement.

Tutorial assistance, limited to $100 per month with a lifetime cap of $1,200, will be covered when an instructor determines a student needs the help.

Payment for a licensing or certification test is a benefit that can be used only once. The VA will pay the cost of the test, up to a maximum of $2,000.

The one-time $500 travel allowance, added by Sen. Ted Stevens, R-Alaska, would apply in very limited circumstances. It would be paid only to someone who lives in a state with less than seven people per square mile; must travel 500 miles or more to use benefits; and can travel only by air because roads are not available.

That essentially limits the benefit to rural Alaska. To get paid, individuals must prove they live in a remote area.

Advance payments — lumping several months of benefits to cover course costs — also will be permitted, though VA will have to craft rules on how this would be done.

What happens to my current Montgomery GI Bill and my $1,200 contribution?

It's a situation certain to cause confusion: two GI Bill programs will operate simultaneously, the Montgomery GI Bill that has been available since 1985, and the Post-9/11 GI Bill that fully takes effect next year.

Defense officials believe both programs should be continued because the Post-9/11 GI Bill mainly helps those attending college, while the Montgomery GI Bill covers apprenticeship and on-the-job training, correspondence courses, flight training and other kinds of training programs not covered by the new plan.

Because the new law did not repeal or even significantly modify Montgomery GI Bill rules, new recruits will continue to be automatically enrolled in the program unless they opt out.

The new law has no provision to stop contributions to the GI Bill once they start, according to defense officials, so those already enrolled in the Montgomery GI Bill must continue to make their installment payments.

Officials are preparing a new bootcamp briefing describing the two GI Bill plans. It will strongly urge anyone who might possibly use the noncollege benefits of the Montgomery GI Bill to enroll and pay the $1,200 contribution so their options remain open down the road.

Anyone enrolled in the Montgomery GI Bill, or who later enrolls, and decides to use the Post-9/11 GI Bill will not lose their $1,200 contribution. The new law provides for refunds of contributions by adding $1,200 to the final GI Bill payment for those who use their full 36 months of benefits.

It is possible to be eligible for duplicative education benefits under more than one program, but a service member or veteran can use only 36 months of total benefits.

How much time do I have to use the benefits?

The Post-9/11 GI Bill would be available for 15 years after separation or retirement, five years more than allowed under the Montgomery GI Bill.

The 15 years are counted from the last period of active duty of at least 90 consecutive days. For those separated or retired because of a service-connected disability, the countdown begins from the last period of at least 30 consecutive days of active service.

People using the Montgomery GI Bill program would still be limited to 10 years of post-service availability.

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